POWERCHINA
SPEM LIMITED COMPANY, a company incorporated in the Peoples Republic of China having
its registered address at 80 Hangdu Road, Shanghai, China 201316 (“SPEM”)

Collectively
referred to as the “Parties”

WHEREAS

(1)

PGTC
owns the rights to patented emission control systems including ENVI-CleanTM,

(2)

PGTC
and SPEM have entered into a joint venture partnership to market, fabricate and install
ENVI-CleanTM emission control technologies in the Peoples Republic of China,

(3)

The
partnership will complete the installation of an ENVI-CleanTM system at the
Lianxin Steel Group Plant in Yancheng China by November 30, 2016.

(4)

Following
commissioning the members of the partnership wish to conduct testing on the installed
system for the purposes of researching the limiting emission control efficiencies for
both flue gas desulphurization (“FGD”) and particulate matter (“Dust”)
and develop the optimum operating parameters to minimize OPEX for this and future installations,

(5)

The
parties have agreed to develop a comprehensive Quality Assurance Project Plan (“QAPP”)
to ensure that the research and development program undertaken at Lianxin Steel Group
Plant is conducted according to a technically valid plan using established and regulatory
agency accepted protocols and procedures.

(6)

PGTC
and SPEM have mutually agreed to enter into a Research and Development Program.

IT
IS AGREED

1.

DEFINITIONS AND INTERPRETATION

1.1

The following terms shall have the following meanings:

Term

Shall mean the term of this Agreement described
in Clause 2;

Force
Majeure

Shall mean any event affecting the performance of any
provision of this Agreement arising from or attributable to acts, events, omissions or accidents which are beyond the reasonable
control of a party including, without limitation, any abnormally inclement weather, flood, lightning, storm, fire, explosion,
earthquake, subsidence, structural damage, epidemic or other natural physical disaster, failure or shortage of power supplies,
war, military operations, riot, crowd disorder, strike, lock-outs or other industrial action, terrorist action, civil commotion
and any legislation, regulation, ruling or omissions of any relevant government, court or any competent national or international
authority;

2

1.2

The singular includes the plural and vice versa.

1.3

The clause headings do not form part of this
Agreement and should not be taken into account in its construction or interpretation.

1.4

References in this Agreement to the Schedule
are to the Schedule to this Agreement.

2.

TERM AND APPOINTMENT

2.1

This Agreement shall
have effect for one year from the acceptance of the ENVI-Clean TM system by Lianxin Steel Group.

3.

PAYMENT AND CONSIDERATION

3.1

The consideration
for SPEM’s services, PGTC has agreed to a fee of *RME1 ;050,000 to be paid as US$ 160,198 on each of the
3 month and 6 month anniversaries from the date of acceptance of the system.

4.

ASSIGNMENT, CONFIDENTIALITY & SEVERABILITY

4.1

Neither party may
assign any of its rights or obligations under this Agreement without the prior written consent of the other party, such consent
not to unreasonably withheld or delayed providing that neither party is detrimentally affected by the assignment.

4.2

The parties acknowledge
that the contents, in particular the financial details of this Agreement are confidential and neither party will disclose
any information concerning the terms of this Agreement without the prior written consent of the other except as required by
law or as reasonably necessary for the operation of this Agreement.

4.3

Should any provision
of this Agreement be considered void or voidable under any applicable law, such provision shall to the extent required be
severed or amended in such a manner as to render the rest of this Agreement valid or enforceable, unless the whole commercial
object is thereby frustrated.

5.

ENTIRE AGREEMENT AND WAIVER

5.1

This Agreement contains the entire agreement of the
parties with respect to the subject matter of this Agreement,

5.2

This Agreement may only be varied by the written agreement
of both parties,

5.3

A waiver by either party of a breach of any term or
condition of this Agreement in any one instance shall be in writing, and shall not be deemed as a continuing waiver or a waiver
of any subsequent breach unless so provided by written notice.

3

6.

FORCE MAJEURE

Should
either party’s obligations under this Agreement be materially hampered, interrupted or interfered with by reason of any
Event of Force Majeure, then the obligations of that party shall be suspended during the period of such hampering, interference
or interruption consequent upon such event or events and shall be postponed for a period of time equivalent to the period or periods
of suspension, and the parties will use their best commercial endeavors to minimize and reduce any period of suspension occasioned.

7.

NO PARTNERSHIP, GOVERNING LAW & ANNOUNCEMENTS

7.1

Nothing contained
in this Agreement shall be deemed to alter the terms of the joint venture partnership between the parties.

7.2

This Agreement shall
be governed by and construed in all respects in accordance with the laws of the Peoples Republic of China and each party hereby
submits to the exclusive jurisdiction of the Chinese arbitration or courts.

7.3

Neither party shall
make (and the parties shall ensure that no person connected with them shall make) any public statement, issuance or announcement
about the signature of this Agreement without the prior written approval of the other party except as required by law or by
any legal authority.

IN
WITNESS whereof the parties have duly executed this Agreement the day and year first above written.

Authorized
for and on behalf of
PACIFIC GREEN TECHNOLOGIES CHINA. LIMITED